Hurricanes, Rising Incomes Drive Strong Year-End Demand Growth

  • Hotel demand grew 3.7% nationally in Q4 2017, up from the 2.4% rate in Q3. Supply growth remained steady at 1.9%.
  • Continued disruption from Hurricane Harvey led to Houston having the largest demand increase (31.1%).  High gains also occurred in the Hurricane Irma-affected markets of West Palm Beach (12.0%), Miami (9.1%) and Orlando (8.1%).
  • National occupancy rose by 1.8% year-over-year, resulting in record-high occupancies in 2017.
  • ADR grew by 2.4% nationally in Q4, up from 1.4% in Q3. RevPAR grew by 4.2% year-over-year in Q4, the quickest pace of any quarter in 2017.
  • More than half of the 60 markets tracked by CBRE Hotels' Americas Research had supply gains of more than 2% in Q4, about the same as in Q3. Twenty-four markets had declines in occupancy, approximately one-third fewer than in Q3.
  • A 26.8% increase in occupancy and 11.1% increase in ADR gave Houston the largest increase in RevPAR (40.9%) in Q4. West Palm Beach, another market affected by the 2017 hurricane season, had the second-highest RevPAR growth at 19.1%.
  • Seven of the top-10 markets for RevPAR growth saw increases driven primarily by occupancy, a reversal of Q3 results.